Reporter for The Canberra Times

A legal win for a public servant left mentally damaged from being told to work a standard five-day week could lead to many more workers' compensation claims, according to the woman's lawyers.

Centrelink employee Jenny Pettiford has been off work for 2½ years with anxiety disorder since a meeting in 2011 where managers told her working hours of 8am to 4pm, Monday to Friday, were ''not negotiable''.

But the Administrative Appeals Tribunal sitting in Sydney has backed Ms Pettiford's claim for workers' compensation, ruling that Centrelink acted ''unreasonably'' when it told her she would have to work the same hours as most of her colleagues at the Mudgee office.

The tribunal's decision leaves the taxpayer liable to pay Ms Pettiford's full wages for her first 10 months off work and 75 per cent of her salary for the remainder of her absence, which could be until retirement age, as well as medical expenses.

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Ms Pettiford's lawyer, Greg Isolani of Melbourne firm KCI Lawyers, says the case is a legal breakthrough because it relied on the Fair Work Act rather than the public sector compensation laws usually used in Comcare appeals.

The tribunal found that Centrelink was obliged in its standard workplace agreement to negotiate with employees over issues such as working hours, even if previous attempts at discussions had failed.

Tribunal senior member Anne Britton ruled that managers who treated employees ''with kid gloves'' for fear of being the subject of complaints were still required to genuinely negotiate on working conditions.

''There is no escape clause in the agreement in respect of employees who are considered by managers to be difficult to negotiate with,'' Ms Britton wrote in her decision.

Ms Pettiford, herself a psychologist, worked as a job capacity assessor at Centrelink in Mudgee until a meeting with her supervisors in August 2011. The assessor had been working at Centrelink Mudgee for five years, mostly a four-days-a-week roster starting at 7am and leaving at 4pm.

Ms Pettiford's bosses were unhappy with the arrangement, which left the Centrelink office without a psychologist one day each week, but it allowed Ms Pettiford to ride to work with her husband from the couple's out-of-town property.

Previous attempts to resolve the impasse had failed and in 2010, the public servant had launched bullying allegations against her boss Paul Nugent after the two disagreed about her working hours. A workplace investigator found there had been no bullying or harassment.

After the meeting of August 30, 2011, Ms Pettiford went home, did not return to work, and lodged a claim for workers' compensation citing anxiety and depressive disorder.

Federal workplace insurer Comcare rejected the claim in October that year and early in 2012 Centrelink directed Ms Pettiford to return to her desk after she was found to be medically fit for work.

But the Comcare decision is now set aside by the tribunal and the insurer must either pay out the claim or appeal to the Federal Court.

Another Comcare claim, this one alleging the return-to-work directive and Comcare's handling made the psychologist's condition worse, is still before the tribunal.